On Friday the GBP/USD pair expressed massive bullish reaction towards the lower limit of the Yellow channel around 1.5490 making a quick bullish movement of about 230 pips then reaching the upper limit of the Violet channel around 1.5705 and exceeding the Average Daily Range by about 85 pips.
Because of this strong bullish movement, a fresh bullish trend is thought to be started. However, today at earlier hours GBP/USD managed to break through the lower limit of this Violet channel which indicates a coming bearish retracement before further continuation of the uptrend.
The lower limit of the Yellow channel is being tested now around price level 1.5660 which should be broken in order to make bearish retracement targeting 1.5605. However, if GBP/USD fails to break the lower support level, it will push the pair quickly to the upside towards 1.5745 and then 1.5777.
The GBP/USD pair needs to break through the Resistance level 1.5720 (the upper limit of the Violet channel) in order to resume its bullish direction towards 1.5745 and then 1.5777.
Price level 1.5600 is expected to act as a strong Intraday Support Level for the GBP/USD pair because it corresponds to the Average Daily Range for today where price action should be watched for a possible buy entry resuming the uptrend initiated last week.